3i Group plc said today it had closed on its latest collateralized loan obligation (CLO), a $500 million deal dubbed Jamestown CLO II.
It is the second CLO raised by 3i Debt Management US since the business, a joint venture with WCAS Fraser Sullivan Investment Management, was established in August 2012.
An aggregate of $460 million of investment grade debt was issued in six classes and, in addition, $50 million of subordinated notes were issued. 3i Group has taken a minority stake in the subordinated notes.
Jamestown II is a refinancing of Fraser Sullivan CLO V, a $400 million CLO launched in February 2011 that had reached the end of its two-year reinvestment period. 3i said a number of new and existing investors committed to the new deal.
Jamestown II will focus on investing in U.S. corporate debt and in senior secured loans backing private equity buyouts in the US.
3i did not indicate where the deal priced; however the senior-most tranche, the ‘AAA’-rated $307 million Class A-1 was marketed at Libor plus 127 basis points, according to a presale report issued by Standard & Poor’s.
Jamestown CLO II has a four-year reinvestment period and is non-callable for two years, according to S&P.